Meralco core income up 8% to P11.4-B in H1

Published July 26, 2021, 4:26 PM

by Myrna M. Velasco

With combined uptrend in energy sales and expanding customer base, the core net income of power utility giant Manila Electric Company (Meralco) had risen 8.0-percent to P11.399 billion in the first half of 2021 from the year-ago level of P10.588 billion.

On the company’s reported net income, that climbed by a significant 45-percent to P9.949 billion in the first six months of the year versus P6.844 billion within the same period in 2020.

According to Meralco Chief Financial Officer Betty Siy-Yap, one major item that accounted for the difference in the income reported last year was the ‘impairment’ on the Pacific Light venture of the company which had been booked at P2.7 billion.

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For this year, she emphasized that Meralco’s core earnings before interest, taxes, depreciation and amortization (EBITDA) stood at P23.3 billion, which was 52-percent higher than last year’s P15.4 billion; while reported EBIDTA was at P22.8 billion.

The major adjustments between the core EBITDA and consolidated core net income, as noted by the company’s finance executive, had been depreciation of P5.5 billion; interest expenses amounting to P417 million; taxes at P7.1 billion as well as other items.

Yap also stated that the Meralco board approved on Monday (July 26), the declaration of an interim cash dividend amounting to P5.057 per share that will be extended to all shareholders as of record date August 23, 2021 and to be paid on September 15 this year. That represents the company’s 50-percent of core earnings per share.

Meralco Chairman Manuel V. Pangilinan has not given any ‘core income guidance’ for the power firm this year, but he hinted that the overall expectation will be for it to top its P21.71 billon scale of profitability last year.

“We have not given any guidance for the full year; because we’re quite concerned about the recent spread of the Delta variant of the virus which could further the lockdowns; so that’s a factor that we cannot foresee on the impact on sales moving forward,” he said.

Pangilinan qualified though that “profits would be ahead barring any unforeseen circumstances…it will be ahead of last year for 2021.”

In terms of sales growth, Meralco President and CEO Ray C. Espinosa indicated that the main driver in the 7.0-percent sales uptrend within January to June this year was still attributed to the demand of residential consumers; as well as the expanding customer count of the utility firm — wherein more than 300,000 new customers had been connected by Meralco in this year’s first semester.

It was expounded that consolidated volumes had grown 3.0-percent for residential end- users compared to last year; while commercial volumes had just been slightly up by 0.1-percent within the six-month stretch; although in the months of May and June, the demand of that segment had grown remarkably by 54-percent and 29-percent, respectively.

“The growing public confidence with the gradual increase in the number of people vaccinated and first full month of GCQ (general community quarantine) in June 2021, resulted in the uptick in business activities and foot traffic to malls, restaurants, hotels and other retail outlets,” Meralco stressed.

The company added that “the second quarter of 2021 also saw increasing onsite work activities, which contributed to the rise in commercial sales volumes.”

 
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